Markets wipe off gains to trade in red

Erasing all their early gains, Indian benchmarks entered into red territory in the late afternoon session, as investors’ opted profit taking at select blue chip counter. Cautions prevail in the market ahead of August series derivatives expiry. Sentiments remained downbeat with the private repot indicating that India Inc is enduring its worst earnings drawdown of the last 20 years, burdened by weak growth, high interest costs with excessive private sector debt and over-capitalised balance sheets. Besides, weak opening in European counter too dampened sentiment. European markets came under pressure, as investors assessed recent gains before Federal Reserve Chair Janet Yellen’s Friday address in Jackson Hole, Wyoming.

Back home, downside remained capped with the Commerce and Industry Minister Nirmala Sitharaman pitching for as much as 200 basis points that is 2 per cent, interest rate cut by RBI to help the cash-starved MSME sector. On sectoral front, railway stock such as Kernex Microsystems, Titagarh Wagons and Texmaco jumped after the government approved rail projects worth Rs 21,000 crore. In scrip specific development, Jubilant Life Sciences surged after it received final approval from the US health regulator to sell tablets used in the treatment of hypertension in the American market.

The BSE Sensex is currently trading at 27973.57, down by 86.37 points or 0.31% after trading in a range of 27958.00 and 28154.21. There were 8 stocks advancing against 22 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index was down by 0.03%, while Small cap index was up by 0.19%.

The top gaining sectoral indices on the BSE were FMCG up by 0.58%, Oil & Gas up by 0.23%, Bankex up by 0.12% and Realty up by 0.11%, while TECK down by 0.97%, IT down by 0.93%, Metal down by 0.70%, Auto down by 0.44% and Consumer Durables down by 0.13% were the losing indices on BSE.

The top gainers on the Sensex were ITC up by 1.50%, GAIL India up by 1.30%, Axis Bank up by 0.93%, Dr. Reddys Lab up by 0.85% and Cipla up by 0.80%. On the flip side, Adani Ports &Special down by 3.05%, Wipro down by 1.99%, Infosys down by 1.40%, Tata Steel down by 1.35% and Bharti Airtel down by 1.21% were the top losers.

Meanwhile, the India Meteorological Department (IMD) has stuck to its initial forecast of above normal rainfall this season as the La Nina phenomena, which gives a boost to Southwest Monsoon and was expected to give a good rainfall in September, has been delayed. IMD has made a forecast of 106 percent of the Long Period Average (LPA) with the model error of plus or minus four per cent.

IMD stated that as far as India is considered the El Nino which was harmful to the Indian monsoon has faded and reached a neutral level. In the initial stages they were expecting La Nina to start, but it has been delayed now. However, they refused to make any amends to the forecast. The La Nina was to start by August-September, but the cooling of ocean surface temperature is taking a longer time for the phenomenon to occur. As per the initial forecast, September was to receive excess rains due to this phenomenon.

El Nino is the unusual warming of sea-surface Pacific waters off the South American coast. La Nina is the positive phase of the El Nino and is associated with cooler than average sea surface temperatures. As per the IMD parameter rainfall between 96-104 percent of LPA is considered as normal rainfall, between 104-110 percent is considered as above normal and above 110 percent of LPA is considered as excess.

The CNX Nifty is currently trading at 8633.75, down by 16.55 points or 0.19% after trading in a range of 8627.20 and 8683.05. There were 22 stocks advancing against 29 stocks declining on the index.

The top gainers on Nifty were BHEL up by 2.34%, ITC up by 1.52%, BPCL up by 1.48%, HCL Tech. up by 1.36% and GAIL India up by 1.27%. On the flip side, Adani Ports &Special down by 3.11%, Idea Cellular down by 2.39%, Wipro down by 2.08%, Zee Entertainment down by 1.57% and Bharti Infratel down by 1.49% were the top losers.

Asian market were trading mostly in red; Nikkei 225 decreased 41.35 points or 0.25% to 16,555.95, Shanghai Composite declined 17.55 points or 0.57% to 3,068.33, FTSE Bursa Malaysia KLCI dropped 2.51 points or 0.15% to 1,679.55 and KOSPI Index was down 0.84 points or 0.04% to 2,042.92. On other hand, Hang Seng increased 6.09 points or 0.03% to 22,826.87, Jakarta Composite increased 32.31 points or 0.6% to 5,436.30 and Taiwan Weighted surged 98.09 points or 1.09% to 9,115.47.

European markets were trading in red; Germany’s DAX decreased 122.14 points or 1.15% to 10,500.83, UK’s FTSE 100 declined 53.41 points or 0.78% to 6,782.37 and France’s CAC felled 48.82 points or 1.1% to 4,386.65.